Advertise
Resources
Member, Beacon International Group, Ltd.
NEW YORK—Lloyd's of London has received permission from the New York State Insurance Department to post reduced collateral on reinsurance contracts.
The London-based specialty insurance market said on Friday that it is approved as a Secure-3 reinsurer and that its collateral requirements will be reduced from 100% to 20%.
“This decision recognizes Lloyd's longstanding financial strength and security,” said Sean McGovern, Lloyd's director of North America, in a statement. “Foreign reinsurers play an important part in supporting the U.S. insurance industry, and the steps taken by some individual states to reduce collateral requirements are to be welcomed. However, our goal remains the complete and consistent removal of discriminatory collateral requirements in the U.S.”
Reinsurers have lobbied for years for the relaxation of a rule that states non-U.S. reinsurers must post collateral equal to 100% of their U.S. claims liabilities, arguing that the collateral requirement puts non-U.S. reinsurers at a disadvantage in the U.S. market.